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TMI Blog2005 (12) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... r to the Act 14 of 1999, and as on the said date, there was no mandatory condition for pre-deposit of disputed tax before the appeal was lodged. We hold that the crucial date on which the right of the assessees to prefer an appeal u/s 31 or Sec.36 of the Act is the date on which the returns are filed under the Act. In all these appeals, returns were filed long prior to the date when the provisions of Sec.31 of the Act was amended by virtue of Act 14 of 1999. Further more, it is not disputed by the parties that the aforesaid amendments to the Act have not been given retrospective effect as and from an anterior date and those amendments are prospective. Therefore, the appeals are liable to be entertained without insisting of pre-deposit of 25% of the disputed tax as per the amended provisions of the Act. In the result, the order of the learned single Judge is set aside. The writ appeals preferred by the Revenue, are dismissed and the appeals filed by the assessees are allowed. The appellate authority is directed to entertain the appeals filed by the assessees/appellants without insisting for pre-deposit of 25% of the disputed tax and dispose of the same in accordance with law. - HO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 of the Act, as it stood prior to 10-6-1999, the appellant had to pay only the tax admitted by him to be due. By Tamil Nadu General Sales Tax (4th Amendment) Act, 1999 (Act No.14 of 1999), with effect from 10-6-1999, the second proviso to Sec.31 of the Act was amended to provide for mandatory pre-deposit of 25% of the difference between the tax assessed and admitted before a first appeal is entertained. Corresponding amendment was brought about to Sec.36 of the Act providing for a right of appeal to the Tamil Nadu Taxation Special Tribunal ( in short 'the Tribunal) requiring mandatory pre-deposit of the entire taxes ordered to be due by the first appellate authority under Sec.31 of the Act. By Act 32 of 2000, effective from 26-11-2000, the predeposit under Sec.31 of the Act was reduced to 12.5% of the disputed tax. Finally, by Act 19 of 2002, effective from 3-6-2002, the predeposit under Sec.31 of the Act was once again raised to 25% of the disputed tax. 6. It is not disputed that the amended provisions of the Act are not given retrospective effect as and from an anterior date. In other words, the amended provisions are prospective. According to the appellants, the above restr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch right of appeal was a substantive right which the assessee had acquired under the Sec. 22(1) as it stood prior to amendment and the subsequent amendment to that section did not take away the right of appeal without depositing the impugned amount. The assessee's appeal, filed without accompanying the proof of payment of the tax assessed as required under the amended provision, was rejected. In short, the issue was whether the imposition of restriction by the amendment of the section could affect the assessee's right of appeal from a decision in proceedings which commenced prior to such amendment and which right of appeal was free from such restriction under the section as it stood at the time of the commencement of the proceedings. Das, J., speaking for the Bench, observed: Whenever there is a proposition by one party and an opposition to that proposition by another a 'lis' arises. It may be conceded, though not deciding it, that when the assessee files his return a 'lis' may not immediately arise, for under Section 11(1) the authority may accept the return as correct and complete. But if the authority is not satisfied as to the correctness of the return a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise. 11. Another Constitution Bench of the Supreme Court in the case of Vitthalbhai Naranbhai Patel v. Commissioner of Sales Tax, Madhya Pradesh, Nagpur (1961 [12] STC 219 SC) held as follows: That leaves over for consideration the question whether Hoosein Kasam Dada's case, should be applied. That also presents some difficulty to us. We have before us the petition which was made in the High Court, and we cannot allow that to be amended. That petition does not mention the dates on which the return was filed, so that we could apply the dictum of this Court in Hoosein Kasam Dada's case. Dr. Barlingay deduces the date of filing of the return from the dates on the challans accompanying the payment of tax in the treasury, and argues that this was prior to the amendment. He contends that this is sufficient for the application of the principle in the said case. The decision in Hoosein Kasam Dada's case proceeded on the ground that when a lis commences, all rights get crystallised and no clog upon a likely appeal can be put, unless the law w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mendment and hence the amendment did not apply. This contention was negatived by the Supreme Court. It is well-settled that a judgment has to be understood in the light of the facts involved therein. We fail to understand as to how the decision in Hardeodas Jagannath case can be said to overrule the decision of the Supreme Court in the case of Hoosein Kasam Dada case, supra, by implication, as contended by the learned counsel for the Revenue. 14. The next question is as to when such a pre-existing right of appeal becomes vested in a party Is it on the date of filing of the returns? or is it on the date when a pre-assessment notice is issued? or it is on the date when proceedings are initiated for reopening an assessment?. 15. Learned counsel for the appellants drew our attention to the decision of the Supreme Court in the case of Ghanshyamdas v. Regional Assistant Commissioner of Sales Tax, Nagpur and Others (1963[14] STC 9 76). The Supreme Court in that case was dealing with escaped assessment. Under Section 11-A of the Central Provinces and Berar Sales Tax Act, 1947, if the Commissioner was satisfied that any turnover of a dealer for any period had escaped assessment, the Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Supreme Court. It held that the proceedings will commence after the return was submitted and would continue until final order of assessment was made in regard to the said return. Once the proceedings were initiated no question of limitation will arise. Similar are the observations made in the case of Regional Assistant Commissioner of Sales Tax, Indore v. Malwa Vanaspati and Chemical Company Limited (1968 [21] STC 431 SC) and State of Punjab v. Murlidhar Mahabir Parshad (1968 [21] STC 29 SC). 16. In Oswal Agro Mills Ltd. v. State of Punjab And Others (2005 [139] STC 51), a Division Bench of the Punjab and Haryana High Court, after considering the various decisions of the High Courts and the Supreme Court, concluded as under: In civil proceedings, lis commences on the presentation of the plaint or in cases claiming compensation under the Motor Vehicles Act on filing claim application. The question is when lis can be said to commence under the taxation laws. Section 25 of HGST Act enjoins a duty upon an assessee to file quarterly return and deposit tax thereon. If such returns are accepted, there is no lis. Consequently, there would be no occasion for the parties to file an app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... swal Agro Mills Limited (supra) respectively would not apply in the context of the scheme of the TNGST Act and the Rules framed thereunder. He urged that those decisions were rendered in the context of the provisions of the Bombay Sales Tax Act and Punjab General Sales Tax Act. The provisions in the said Acts vest the Commissioner the power to issue notice to the assessee calling upon him to file the returns whereas there is no such provision under the TNGST Act and the rules framed thereunder. In our opinion, the distinction sought to be made by the learned counsel for the Revenue is without any difference. It is seen that the judgments of the Bombay High Court and Punjab and Haryana High Court do not turn on that provision at all. In Siemens India Limited case, supra, the assessee filed its returns voluntarily without being called upon by the Commissioner to file its return. In Oswal Agro Mills case, supra, also the assessee had filed its return prior to the amendment coming into force. 21. Learned counsel appearing for the Revenue alternatively submitted that the reassessment order under Sec.16(1)(a) of the Act will not result in the wiping out of the original assessment order a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved as follows: We also give considerable weight to the Full Bench judgment in Tamil Nadu Small Scale Industries Corporation Limited v. State of Tamil Nadu [1989] 74 STC 303 (Mad). They have diluted the emphasis on 'lis' and therefore the emphasis on commencement of proceedings in tax laws, become important. In this connection, we can also refer to rules 7 to 18 of the Tamil Nadu General Sales Tax Act. They prescribed the dates when dealers are obliged to file returns, under various circumstances. Even if a nil return is filed and accepted, there is no guarantee that it will not be re-opened. Any assessment order can also be revised. It is not proper to leave the discretion to the authorities, as to when they call for accounts or when they issue a preassessment notice or a revision notice. It is wiser and safer to adopt a firm date as the date on which the vested right of appeals vests on the assessee. 24. It is conceded by the learned counsel for the Revenue that no appeal has been filed against the above judgment of the Taxation Special Tribunal and that the judgment, therefore, has become final. It appears that pursuant to the said judgment of the Taxation Special Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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